Oracle spent years fighting AWS. Their new partnership is a turning point

As one of the most dominant enterprise software providers during the early days of the internet buildout, Oracle had a difficult time accepting the swift ascent of AWS in the early 2010s to a perch it believed was its birthright. After years of trading barbs, misinformation, and outright insults, a more pragmatic Oracle and a maturing AWS have turned a corner.

Oracle co-founder and CTO Larry Ellison appeared on stage at Oracle CloudWorld Tuesday with AWS CEO Matt Garman, an event that would have been downright shocking five years ago. They were there to discuss Oracle Database@AWS, a new partnership between the two companies that follows similar agreements Oracle struck with Microsoft and Google Cloud over the last year.

Oracle customers will now be able to run its flagship database on dedicated Oracle hardware inside AWS data centers and move data back and forth between Oracle and AWS services with far less latency.

Those customers have been able to run Oracle on AWS's cloud for a long time, but the new partnership makes it much easier. Mutual customers will be able to manage their Oracle databases through the AWS console, and the companies streamlined the billing and customer support process.

"A lot of customers are wanting to move to the cloud, and the more we can make it easy for them to use the components and the applications that they love and that they use as part of their their operating environment, and make it easy to migrate those without having to change those out, the faster many of these customers can go on that modernization journey," Garman said.

The new partnership is the final piece in a strategic shift for Oracle.

For years, it tried to convince longtime database customers who wanted to shed their on-premises data centers to run those databases on Oracle's public infrastructure cloud, slamming AWS at every turn. But those customers were already investing heavily in the cloud infrastructure sold by AWS, Microsoft, and Google, and wanted a better way to keep using Oracle's database while taking advantage of the new capabilities offered by cloud computing.

"We're a huge Exadata user, and we're a huge partner with AWS, and we ran into the complexity of all the data running on Exadata," said Andy Zitney, CTO of State Street, while on stage with Ellison and Garman.

Almost a year ago Ellison joined Microsoft CEO Satya Nadella at Microsoft's headquarters ("It’s actually my first time in Redmond," he said) to unveil Oracle Database@Azure, which works the same way as the new AWS partnership. Oracle and Google Cloud announced their version of that partnership in June, and Oracle Database@Google became generally available on Monday.

The partnerships are a belated acknowledgment that Oracle's own public cloud efforts are unlikely to convince large enterprises to drop the Big Three, which was Ellison's goal for years.

Oracle's cloud infrastructure business is growing faster than any of them, but it only commands a tiny amount of overall public cloud spending. And as Captain CapEx Charles Fitzgerald likes to point out, Oracle is unlikely to match their infrastructure footprint any time soon based on how much it spends each quarter on capital expenditures.

So instead of fighting directly with the cloud providers, Oracle and Ellison wisely acknowledged that their database customers — some of the biggest enterprises in the world — are going to be using AWS, Microsoft Azure, and Google Cloud for years.

"We think this dramatically expands the market," Ellison said Tuesday. "It's what customers have asked for for a very long time."

(This post originally appeared in the Runtime newsletter on Sept 10th, sign up here to get more enterprise tech news three times a week.)